Credit Rating: How it works and How to improve it discussion area

greydee

Sally87 wrote: »

Question 10 is a bit loaded - it asks whther you pay off your credit cards and store cards in full each month - I don't have any, but obviously answering 'no' isn't going to help the rating...:)

actually it does credit card companies want you to pay the minimum so it gets more money from you prompt on time minimum payments will actually help raise your score according to the information on this site

gazelle8760

greydee wrote: »

actually it does credit card companies want you to pay the minimum so it gets more money from you prompt on time minimum payments will actually help raise your score according to the information on this site

Minimum payments may help raise your score, but a high score is no good to you when your up to your eyeballs in debt.

You can look at payments two ways. If you pay your balance in full each month, you show you can potentially manage a high limit, however, it could also show that a higher limit is not necessary, as if you can afford to pay the whole lot off monthly, you probably don't need it.

Credit Scores are not a reliable way of deciding who gets credit, as if I was to believe what Experian showed me, I should have nothing, when in fact both Nationwide and Lloyds say my scores are very good and I am low risk. I do pay my balances off monthly, and have had four limit increases on Capital One since March 03, I make them no money, in fact I make them work for me, I take full advantage of the 56 days interest free credit, and they take full advantage of reporting this to the credit bureau, in fact in my opinion they report too much, they report the previous statement balance, the amount paid, the last credit limit increase and if you have had any cash advances and if it was at an introductory rate, it makes interesting reading!! My Credit Score doesn't seem to change and I cannot see any difference in it if I make the min payment, or keep on going how I am, I think credit commitments are more important than score, if you can handle what you have, you will stand in good stead for future borrowing.:j

Sportbilly_2

Hmm, after being declined for a couple of cards recently, I thought I'd best check what was going on. So I signed back up to Experian, and get this on the 'Home' page-

We're currently updating our records, so are unable to display your latest credit report at the present time.

If I try and view my report, I get-

Please call us...
We are sorry, but there has been a problem processing your order.
Please contact our Customer Service team on freephone 0800 656 9000, where one of the team will be happy to help. They are available Monday to Friday 9am to 6pm, and Saturday 9am to 1pm.

Is this just because of a monthly update? I don't really understand why they can't display my report.

CPJames19

Does any1 know how to setup a direct debit to "repay EVERY month, in FULL, so there's no interest cost?"

CocoPopsLover

CPJames19 wrote: »

Does any1 know how to setup a direct debit to "repay EVERY month, in FULL, so there's no interest cost?"

contact ur lender and tell them thats what u want to do

iwantasmallholding

Hiya

Peoples thoughts?

If I organise my DD to go out at the end of the month, and get paid on the 1st, if is was to transfer my salary between two accounts a couple of times a month hence a 1500 income to an account would show as 4500 being paid in would this have an effect, would I also be able to get a better current account????

never-in-doubt

iwantasmallholding wrote: »

Hiya

Peoples thoughts?

If I organise my DD to go out at the end of the month, and get paid on the 1st, if is was to transfer my salary between two accounts a couple of times a month hence a 1500 income to an account would show as 4500 being paid in would this have an effect, would I also be able to get a better current account????

Hi

What usually happens in these cases (i.e. lets assume you bank with HSBC and pay in your £1500 salary each month), by moving into another internal account then moving it back again would show as £3000 credits similarly if you sent it to an external bank elsewhere it would do this. However, believe it or not (and contrary to popular belief) it doesn't help that much cos at the end of the day your current bankers will see what you really earn and will therefore disregard the multiple credits, however you run into problems trying to open accounts elsewhere as when you do apply, you put your salary - lets say £20k. This means you'll get around £1500 per month; so the new bank will straight away be suspicious as you pay in double this amount - where is it coming from? Drugs? Laundering?

So in answer to your question, it 'may' help any internal scoring procedures but 'could' have a negative impact to external banks.....

Hope that helps make sense of it....

iwantasmallholding

I understand where you are coming from with the money laundering, I also guess customes and Inland Rev would wnat to know where the additional salary was coming from. The main reason I ask is I am 80 pounds per month short of a First Direct account. ie 1420 take home a month, despite being on 30k. But I am a police man so I loose 11% to pension and a further 230 to childcare vouchers. I will just have to be patient.

Thanks for you responce

never-in-doubt

iwantasmallholding wrote: »

I understand where you are coming from with the money laundering, I also guess customes and Inland Rev would wnat to know where the additional salary was coming from. The main reason I ask is I am 80 pounds per month short of a First Direct account. ie 1420 take home a month, despite being on 30k. But I am a police man so I loose 11% to pension and a further 230 to childcare vouchers. I will just have to be patient.

Thanks for you responce

Ahh, you can do this. What to do is to transfer some out of 1st into another bank and then a few days later transfer the amount back, so say you get £1420, do a £420 transfer and then a week later send it back again. Think about it, so long as you credit £1500 into the account then you comply - it does not say that you must credit it in one block otherwise weekly paid staff couldn't have an account with them nor could a couple that have a joint account and work part time but paid different dates!

I wouldn't do the whole £1420, just do the odd £420 and transfer say £400 back in again a week later!

You can do this. Coupled with the fact you're old-bill, with a perfectly reasonable explanation and an audit trail you'll be fine. :T

stillers77

Hi Guys,

Unfortunately I have missed 4 payments on my student overdraft meaning I now have a bad credit problem, do I understand correctly that these will appear on my record for 6 years?

I want to start rebuilding my credit score and I have been notified my graduate overdraft will transfer into a regular overdraft facility with an EAR of 19% at the end of the month. I am £1000 into my overdraft, is it better for my credit rating to clear my overdraft in one payment or to break it down into smaller payments spread across a year to clear the £1000 + interest?